India's Mahindra & Mahindra has been named preferred bidder for SsangYong, the struggling Korean carmaker announced this week. The news follows reports that previous contender Renault-Nissan balked at a push by SsangYong for a higher price.
A SsangYong representative said today that Mahindra had been chosen as the preferred bidder because it offered the highest price and solid financing plans.
Mahindra Managing Director Anand Mahindra said today that its bid payment will be used to clear long-term debts for SsangYong, valued at around AU$690 million. A final purchase price is expected to be confirmed in October, with the sale scheduled to close in November.
Mr Mahindra said the deal will help his company build a foothold in emerging markets such as Russia and South Africa, where SsangYong has a strong presence, while also giving the Korean carmaker a path into India's growing market.
“This acquisition was not done to penetrate the South Korean market,” said Mr Mahindra. “It was done to create synergies to build our global expansion in emerging and fast-growing markets.”
Although neither brand has experienced great success in the Australian market, SsangYong alone has over 1300 dealers outside of South Korea. Combined, the two companies will have annual sales of more than AU$4 billion dollars.
Mahindra's plans for global growth were also boosted recently when it purchased Renault's share in an Indian car-making plant earlier this year. It is also developing an all-new Pik-Up for international markets.
Early last month, SsangYong Australia announced it will launch an all-new model later this year, dubbed Korando C (pictured above). It is unclear at this stage if these latest acquisition details will affect the Korando C's local debut.